Costing - Study Mode

[#831] Direct material is a _______.
Correct Answer

(B) variable cost

Explanation

Solution: Direct material is a variable cost. Direct material cost is the cost of the raw materials and components used to create a product.

[#832] The most important element of cost in manufacturing industries is _________.
Correct Answer

(A) material

Explanation

Solution: The most important element of cost in manufacturing industries is material. Material is the first and most important element of cost. In most of the manufacturing organisations, materials form the single largest component of cost.

[#833] According to which method of pricing issues is close to current economic values?
Correct Answer

(A) Last In First Out

Explanation

Solution: According Last In First Out method of pricing issues is close to current economic values. LIFO Accounting means inventory which was acquired last would be used up or sold first.

[#834] Continuous stock taking is a part of ________.
Correct Answer

(B) perpetual inventory

Explanation

Solution: Continuous stock taking is a part of perpetual inventory. Perpetual inventory is a method of accounting for inventory that records the sale or purchase of inventory immediately through the use of computerized point-of-sale systems and enterprise asset management software.

[#835] Which of the following methods of stock control aims at concentrating efforts on selected items of material?
Correct Answer

(D) ABC analysis

Explanation

Solution: ABC analysis methods of stock control aims at concentrating efforts on selected items of material. ABC method of inventory control involves a system that controls inventory and is used for materials and throughout the distribution management.